Google mobile Android operating system under U.S. antitrust scanner

The U.S. Federal Trade Commission is investigating whether Google Inc is using its Android mobile operating system to stifle competition, a source familiar with the matter said on Friday.

The Android mobile platform is a key element in Google's strategy to maintain revenue from online advertising as people switch from Web browser searches to smartphone apps, and action by U.S. regulators would be a big problem for the company.

Reuters reported in April that some technology companies had complained to the U.S. Department of Justice about Google's anti-competitive practices and urged the regulator to investigate allegations that Google unfairly uses its Android system to win online advertising.

Google previously tangled with the FTC over Web search allegations and reached a settlement in 2013.

The European Union has accused Google of distorting Web search results to favor its own shopping service as well, and is now probing the Android mobile operating system.

Google shares were up 0.5 percent at $657.93 in premarket trading.

The new FTC probe focuses on whether Google is telling Android handset makers which Google apps they must show on their phones, and how and where they are displayed, the source said.

The FTC and the DOJ just met to discuss who would probe Google and agreed that the FTC would take the case. The probe is in very early stages, the source said.